* Belize plays hardball with creditors
* Government hopes to reach compromise deal
By Jose Sanchez
BELIZE CITY, Sept 19 Belize is considering
making a partial payment on its "superbond" as a sign of good
faith in talks with creditors aimed at restructuring $550
million in debt, Prime Minister Dean Barrow said on Wednesday.
The tiny Central American country missed a $23.5 million
interest payment on the sovereign bond in August and, according
to analysts, was set to default on $550 million of debt as of
Wednesday when a 30-day grace period ended.
"We have been talking about the possibility of a partial
payment," Barrow told reporters, noting that he had been briefed
on the status of talks with bondholders early on Wednesday.
Barrow downplayed the impact of what he referred to as a
"technical default" and said he was optimistic about reaching a
"I've said that the deadline and the triggering of a
technical default doesn't have any serious practical
consequences. In any event, there would be extensions that are
automatically built into the process," he said.
"But we are prepared to demonstrate some good faith if in
turn we get from the bondholders what we consider to be
Representatives of a bondholder committee were not available
After the interest rate on the superbond rose to 8.5 percent
from 6 percent, Belize said it could not afford to service its
debt. The country is reliant on tourism, fishing and farming,
While the amount of debt in question is miniscule, analysts
have argued that Belize's approach to creditors is part of a
larger trend that injects uncertainty into financial markets.
Last month, the government laid out three proposals for
rescheduling its bond payments, shocking analysts with its
suggestion that they take a haircut of up to 45 percent on their
The head of the government's negotiating team said on
Tuesday that Belize was open to counter offers.